Briefing: Healthcare, student housing, and hospitality

Hospitality properties are performing well this year, but outside of our industry, what other asset classes do investors have their eyes on?

There was 2.1% capital growth in UK healthcare property in 2014, and £4.2 billion invested in UK student housing in the first 5 months of 2015. Both sectors have had an increase in demand, with 16,800 more students in 2014 than 2013, and 11.4 million people currently aged 65 or over in the UK.

In this briefing three experts discuss healthcare and student housing and how it relates to hospitality:

According to the IPD UK Annual Health Property Index, healthcare property returned 9% in 2014. The Index also shows that in December 2014 there were a total of 1,073 Healthcare properties in the UK, with £3,957 million Capital value, and 41 funds.

Last year the Financial Times reported that there had been a particular rise in investment in the ‘UK’s £15.1bn-a-year care home market’. As discussed in the above video, there has been increased need for this type of property due to the increased aged population. According to the latest statistics from Age UK, there are now 3 million people are aged 80 or over in the UK. The number of people aged 60 or over is expected to pass the 20 million mark by 2030.

According to Savills, investment into student housing increased 23% 2013-2014, and increased 70% again in just the first 5 months of 2015. With a 3.4% increase in the number of applications for the current academic year, there looks to be a continued demand for this accommodation. The report suggests that the increase in purpose built student accommodation could help free up much needed residential properties.

As two examples of high performing sectors, both healthcare and student accommodation were discussed at the Hotel Alternatives Event this year.